Home  News Government News Political Instability in Mexico?
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Political Instability in Mexico? |
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Sunday, 03 December 2006 |
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Mexico Change of Government Concerns Investors
by Tom Budniak
I am getting a lot emails with concerns of political instability in Mexico like this one .... " With the recent change of the political scene in Mexico, what effect will this have on foreigners that want to buy property? "
In reality, the way the Mexican constitution is established and due to the GATT and Free Trade agreements, the recent political issues in Mexico have not affected our business in any way shape or form. The Mexican Fidecomiso (or Trust) system of foreign ownership along our coasts protects foreign investors and assures security of any property investment involved. Additionally, the title of said property is deposited in what is most likely an international bank such as Citibank, BBV, HSBC or Scotia Bank - these world known banks assume all responsibility of title towards the purchasor.
We are also comforted by the fact that despite a tremendous amount of "hype" by news agencies, there has not been an issue of political instability in Mexico. Public manifestations are legal and constitutional as long as they are peaceful. Doubts in the past elections created a certain amount of discord by one of the losing political parties and as you may have seen, even some personal battles at congress. This, however is not uncommon in an emerging democracy.
Mexico`s three party system still has a few issues that need to be resolved, however the transition of power from one president to the other went through smoothly. One example is the overwhelming support and show of allegiance of Mexico`s Military to the incoming president - this was never at bay.
Mexico considers that foreign real estate investment will continue to be a major source of income and creation of jobs in Mexico. This, along with a wave of support from companies such as GE, GMAC, Citibank, and Scotia Bank supporting foreign investors and creating better forms of long term financing Mexican property as an international guarantee, should satisfy any wary investor.
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